Sri C.N. Narasimha Reddy, Chintamani v. CIT, Bangalore

ITA 914/BANG/2009 | 2005-2006
Pronouncement Date: 26-04-2010 | Result: Allowed

Appeal Details

RSA Number 91421114 RSA 2009
Bench Bangalore
Appeal Number ITA 914/BANG/2009
Duration Of Justice 7 month(s) 15 day(s)
Appellant Sri C.N. Narasimha Reddy, Chintamani
Respondent CIT, Bangalore
Appeal Type Income Tax Appeal
Pronouncement Date 26-04-2010
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted A
Tribunal Order Date 26-04-2010
Date Of Final Hearing 13-04-2010
Next Hearing Date 13-04-2010
Assessment Year 2005-2006
Appeal Filed On 11-09-2009
Judgment Text
THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH A BEFORE DR. O.K NARAYANAN VICE PRESIDENT AND SHRI GEORGE GEORGE K JUDICIAL MEMBER ITA NO.914/BANG/2009 (A SST. YEAR -2005-06) SRI C.N NARASIMHA REDDY JAGADA NILALYA ANJANI EXTENSION CHINTAMANI KOLAR DISTRICT. . APPELLANT VS. THE COMMISSIONER OF INCOME-TAX BANGALORE-IV BANGALORE. . RESPONDENT APPELLANT BY : SMT. GAYATHRI ADVOCATE RESPONDENT BY : SHRI JASON P BOAZ COMMISSIONER OF INCOME-TAX O R D E R PER DR. O.K NARAYANAN VICE PRESIDENT THIS APPEAL IS FILED BY THE ASSESSEE. THE RELEVAN T ASSESSMENT YEAR IS 2005-06. THE APPEAL IS DIRECTED AGAINST TH E REVISION ORDER PASSED BY THE CIT(A) IV AT BANGALORE U/S 263 OF THE INCOME-TAX ACT 1961 THROUGH HIS PROCEEDINGS IS DATED 31.3.200 9 ITA NO.914/B/09 2 2. IN THE PRESENT CASE THE ASSESSMENT WAS COMPLETE D U/S 143(3). CERTAIN ADDITIONS WERE MADE IN THE ASSESSMENT PERTA INING TO UNEXPLAINED INVESTMENT AND EXPENDITURE. THE ASSESS ING OFFICER THEREAFTER ISSUED NOTICE U/S 271(1)(C) AND PROPOSED LEVY OF PENALTY. THE ASSESSEE FILED REPLY TO THE PENALTY NOTICE. G OING THROUGH THE REPLY THE ASSESSING OFFICER DECIDED TO DROP THE PE NALTY PROCEEDINGS AND ACTED ACCORDINGLY. THE CIT(A) ON GOING THROUGH THE RECORDS OF THE CASE HELD THAT THE ASSESSING OFFICER HAS DROPPE D THE PENALTY PROCEEDINGS WRONGLY AND THEREFORE THE ASSESSING O FFICERS ORDER DROPPING THE PENALTY PROCEEDINGS IS ERRONEOUS AND PREJUDICIAL TO THE INTEREST OF THE REVENUE. THEREFORE HE DIRECTED TH E ASSESSING OFFICER TO ISSUE SHOW CAUSE NOTICE AGAIN AND PASS A SPEAKIN G ORDER TO ARRIVE AT A FINDING WHETHER CONCEALMENT OF INCOME WAS THERE O R NOT. THE ASSESSEE IS AGGRIEVED AND THEREFORE THIS APPEAL B EFORE US. 3. THE ASSESSING OFFICER HAS MADE A FINDING THAT TH E PENALTY PROCEEDING WAS DROPPED IN THE LIGHT OF THE COOPERAT ION EXTENDED BY THE ASSESSEE IN THE COURSE OF SURVEY AND ASSESSMET PROCEEDINGS. RELYING ON THE JUDGMENT OF HONBLE HIGH COURT OF KA RNATAKA IN THE CASE OF CIT VS. MURDESHWAR CERAMICS LTD. IN ITA 132 /B/2003 DATED ITA NO.914/B/09 3 6.12.207 THE CIT HELD THAT THE REASONS STATED BY THE ASSESSING OFFICER WERE NOT PROPER. 4. WE HEARD BOTH THE SIDES AND CONSIDERED THE MATTE R IN DETAIL. IT IS A FACT THAT IN THE COURSE OF SURVEY THE ASSESSE E HAD OFFERED AN ADDITIONAL INCOME OF RS.10 LAKHS. IT IS ALSO A FAC T ON RECORD THAT THE ASSESSEE STOOD UP BY HIS WORD AND OFFERED THE ADDIT IONAL INCOME IN THE RETURN FILED THEREAFTER. THEREFORE THE COOPERATIO N EXTENDED BY THE ASSESEE IN THE SURVEY PROCEEDINGS AS WELL AS IN THE ASSESSMENT PROCEEDINGS IS APPARENT. SUPPOSE THE ASSESSEE OF FERS SOME AMOUNT IN THE COURSE OF SURVEY PROCEEDINGS AND THEREAFTER RETRACT AND DOES NOT OFFER SUCH INCOME IN HIS RETURN WHAT IS THE REMEDY AVAILABLE BEFORE THE ASSESSING AUTHORITY? THE REMEDY IS TO MAKE AN ADDITION ON THE BASIS OF EARLIER PROMISES AND OTHER MATERIALS IF A NY. SUCH A PROPOSAL WOULD BE RESISTED BY THE ASSESSEE AND SUCH AN ADDIT ION COULD BE MADE ONLY AT THE COST OF LITIGATION. THEREFORE THERE I S MUCH FORCE IN THE FINDING OF THE ASSESSING OFFICER THAT THE ASSESSEE HAD COOPERATED WITH THE DEPARTMENT IN THE SURVEY PROCEEDINGS AS WELL AS IN THE ASSESSMENT PROCEEDINGS. ONE OF THE FINEST PRINCIPLES OF TAXAT ION IS THAT THE TAX MUST BE LEVIED AND COLLECTED WITH LEAST AMOUNT OF R ESISTANCE AND LITIGATION. THE SAID PRINCIPLE HAS BEEN SATISFIED IN THE PRESENT CASE. ITA NO.914/B/09 4 THEREFORE WE DO NOT FIND ANY WRONG ON THE PART OF THE ASSESSING OFFICER IN DROPPING THE PENALTY PROCEEDING. THERE IS NO GROUND TO HOLD THAT THE ASSESSING OFFICER HAS NOT APPLIED HIS MIND. AS THE FACTS ARE VERY MUCH APPARENT ON THE RECORDS OF THE CASE THE EXTENT OF THE SPEAKING ORDER IS A MATTER OF RELATIVITY. IN THE FACTS AND CIRCUMSTANCES OF THE CASE WE DO NOT FIND ANY JUSTIFICATION IN UPHOLDING THE REVISION ORDER PASSE D BY THE CIT. THE SAID ORDER IS SET ASIDE. IN RESULT THE APPEAL FILED BY THE ASSESSEE IS A LLOWED. ORDER PRONOUNCED ON MONDAY THE 26TH DAY OF APRIL 2010 AT BANGALORE. SD/- SD/- (GEORGE GEORGE K) (DR. O.K NARAYANAN ) JUDICIAL MEMBER V ICE PRESIDENT VMS. ITA NO.914/B/09 5 COPY TO : 1. THE ASSESSEE 2. THE REVENUE 3.THE CIT CONCERNED. 4.THE CIT(A) CONCERNED. 5.DR 6.GF 7..GF ITAT NEW DELHI. BY ORDER ASST. REGISTRAR ITAT BANGALOR E.